HomeMy WebLinkAboutAgenda - 09-20-2005-5kORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: September 20, 2005
Action Agend~
Item No.
SUBJECT: Approval of Tax-Exempt Financing Arrangement for Efland Volunteer Fire
Company, Inc. to Purchase Land
DEPARTMENT: Budget
PUBLIC HEARING: (YIN) No
ATTACHMENT (S):
Attachment 1. Letter from Efland
Volunteer Fire Company, Inc. Board of
Directors President
Attachment 2. Map of Parcel Proposed
for Purchase
Attachment 3. Public Hearing Legal
Notice from News of Orange
Attachment 4. Fire District's Minutes from
August 22, 2005 Public Meeting
Attachment 5. Fire Service Agreement
Attachment 6. Certificate of Approval
INFORMATION CONTACT:
Donna Dean 245-2151
TELEPHONE NUMBERS:
Hillsborough 732-8181
Chapel Hill 968-4501
Durham 688-7331
Mebane 336-227-2031
PURPOSE: To approve a request from Efland Volunteer Fire Company, Inc. to enter into atax-
exempt financing arrangement to purchase land and authorize the Board of Commissioner
Chair to sign the appropriate documents related to the financing arrangement.
BACKGROUND: During last spring's budget planning process, Efland Volunteer Fire Company,
Inc. outlined its plans to acquire land and construct a second fire station in the near future. In
the attached letter addressed to the County's Budget Director, Mr. Ronnie L. McAdams,
President of the Efland Volunteer Fire Company, Inc. confirmed the department's intent to
proceed with the planned purchase (Attachment 1 of this abstract).
The property is located on Highway 70 across from Hancor, Corporation (Attachment 2 of this
abstract is a tax map of the property). The parcel offers direct access to bath Highway 70 and
Frazier Road. The department believes that this location will help with response time on calls in
the northern half of the district. Members from the Efland Fire Department have worked with
the County's Fire Marshal, and staff from the Planning and Inspections and Environmental
Health departments to ensure that the 19-acre site meets regulations and requirements
necessary far future construction of a fire station.
The purchase price of the land totals $120,000. The Department's Board of Directors agreed to
barrow $78,000 from SunTrust Bank in Hillsborough to finance the purchase and to pay the
2
remaining $42,000 from the Department's capital reserve, The interest rate for the 5-year note
is 4,27 percent. Estimated annual payments are in the neighborhood of $17,352 per year and
with a projected beginning date of November 2005, The total repayment, including principle
and interest, equals $86,800. It is important to note that these figures may vary slightly
depending upon the actual loan closing date..
The District also has an outstanding tax-exempt loan that the Board of County Commissioners
approved in December 2004, The annual payments associated with that particular loan are
about $36,000 with an estimated pay-off date of January 2010,
Section 147 of the Internal Revenue Code of 1986 outlines specific steps that must occur when
a tax supported fire department enters into a financing arrangement.
• Conduct a public hearing - On November 22, 2004, the department held a public
hearing regarding the purchase, The Department advertised the hearing in the News of
Orange (Attachment 3 of this abstract). Per the Attachment 4 of this abstract, one district
resident was present at the hearing and a brief description of the land, intended future
use, cost and financing details were presented, The Department did not receive any
written comments from residents of the district.
• Obtain approval of the "applicable elected representatives" - In accordance with
Section 147, the Board of County Commissioners must approve the District's plan to
enter into the debt arrangement. This approval does not create liability on the part of
Orange County nor does it make the County responsible for the repayment of any debt
assumed by the fire district, The approval provides a mechanism for the Commissioners
to acknowledge that, through this financing arrangement, Efland Volunteer Fire
Company, Inc, is pledging use of the District's tax dollars to repay the loan, In order to
comply with this IRS requirement, the Chair of the Commissioners must sign the Fire
Service Agreement (Attachment 5) and Certificate of Approval (Attachment 6),
FINANCIAL IMPACT: The department's major revenues consist of County fire district taxes and
fees for service from the City of Mebane, According to .tune 30, 2004 financial statements (the
mast recent information available to the Budget Office), the district received about $190,097
from those two sources, The department had about $195,082 in its bank accounts as of June
30, 2004. As indicated earlier, the Department financed a fire truck in December 2004 and
used $28,164 from its bank accounts as a dawn payment on a fire truck, This left about
$166,918 in the department's bank accounts,
With the property purchase, the department plans to spend $42,000 to make the down payment
on the property leaving about $124,918 in its bank accounts, Funds remaining in the
Department's bank accounts would serve as a reserve that would potentially be used to cover
unanticipated major expenses such as repairs or replacements of other older equipment,
The departments' current year County approved budget totals $181,628. The department's
approved budget for fiscal year 2005-06 includes funds for debt service associated with this
purchase along with previously approved debt. According to the letter from the Board of
Directors President (Attachment 1 of this abstract), the district may require a tax rate increase in
fiscal year 2006-07 to cover approximately $8,000 in debt service payments for the land.
RECOMMENDATION (S): The Manager recommends that the Board of County Commissioners
approve Efland Volunteer Fire Company, Inc,'s purchase of property and authorize the Board of
Commissioner Chair to sign the appropriate documents related to the financing arrangement.
J 7 ~GC~Atw~ ~ ~~
Sept.. 13, 2005
Efland Volunteer Fire Co., Inc.
PO Box 39, Efland NC 27243
Orange County Commissioners
Donna Dean, Btadget Director
Orange County Budget Office
P.O. Box 8181
Hillsborough, NC 27278
Dear Madams and Sirs:
The Efland Volunteer Fire Department Board of Directors would like to
purchase 19 acres of land for a fiiture second station in Efland. The parcel
address is on Highway 70 West, Efland, NC and is located across from the
Hancor plant on U.S. 7oW
The total cost of the land will be $120,D00.. We intend on financing
$78,000. This money would be financed with a 5 year note at around 4,27
percent, Payments are estimated at $17,352 annually. The total repayment cost
would be around $86,800. The variability in these numbers would be Pram slight
changes in the interest rate based on fhe closing date. We are budgeted for the
payments in this fiscal year. We may require a tax rate increase of around
$8,000 per year to assist with paying this loan., In five years, when the loan is
paid off, the $17,000 could be used to pay for a mortgage an a new station at this
site.
If you have any questions contact myself ar Assistant Chief Peter
Hallenbeck.
'Thank you,
~~,_,,,...._ ~ ~ ~~.~~_._--- fit s
Ronnie L. McAdams, President
Efland Volunteer Fire Co, Inc.
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vegetables, cut gowers,beef. Monday,
Wednesday, kiday,3 to 6 p.m 1100
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with chafrs.CalI434.432-1654, ext31. (7-
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lhankyou (2-lOdc)
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Multi -family yard sale Saturday, Aug.
13 from 8 a.m • 12 p.m.Tons of kids
clothes, toyi, household Items ERand
Rudtan Builtling,Hwy 70,(B-t0,1tMC)
Multl•family yard sale Saturday, Aug.
13, 202 Lakeshore Oc, Nillsbomugh, 7 a m.
until2 p.m (8-10, tip)
3!13 Nuge0ene4tyardsale,3710
Hwy 70 ERand, near Red & White..
Furniture, baby f tams, movies, toys,
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we ve got it all! All items must go! All
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Daniel Boone Merchants Assoc yard
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LEGAL NOTICES
RATES: Divorce, $80;
Administratfve Notice, $9p;
Other, $7,55 per column inch
TO PLACE A LEGAL ad or for
additional Information, email, call
or write:
Pnone:732-2177
FAX: 732-4852
EMAIk legals@newsoforange.com
WEBSIiE FOR LEGALS:
ndegals.com
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LEGAL NOTICES `'
,.;. , ~, ,
NOTICE
STATE OF NORTH CAROLNNI
ORANGE COUNTY
Having qualified as executor
the estate of Juanita Wa.
Casfon of Orange County, Nor
Carolina, this Is to notify
persons having claims again
the estate'of said Juanlla Wal
Casson to present Them to fh
undersigned by October 2(
2005, or this notice will b
pleaded In bar of theft recoven
All persons indebted to sal
estate please make immedlel.
payment
This the 20th day of July, 2005
Daniel Ward Casco
61 Dogwood Acres D
Chapel Hill, NC 2751
July 20, 27; August 3, 10, 2005
NOTICE'TO CREDITORS
Having queliRed as Ih
personal represenlalivesof the
estate of Frederick N
Caslrovinci, late of Orange
County, Nodh Carolina, John J.
Castravlncl and Linda allbe
Gebel, the 'undersigned, do
hereby notify all persons, firms
and corporations having claims
against the estate of the
decedent to exhibit Them to the
undersigned at 1007 Vickers
Avenue, Clly of Durham, Durham
County, North Carcllna 27707,
on or before November 1, 2005,
or this notice will be pleaded In
bar of their recovery All persons,
Rrms and corporations indebted
to the estate will please make
Immediate payment to the
undersigned.
This the 13th day otJuly, 2005.
JOHN J CASTROVINCI and
LINDA ALICE GESEL
Personal Represenlalives
WILFRED F DRAKE
1007 Vickers Avenue
Durham, North Carolina 27707
819-683.0441
July 20, 27; August 3, 10, 2005
NOTICE
STATE OF NORTH CAROLINA
ORANGE COUNTY
Having qualified as executor of
the estate'of Harriet G Hacker of
Orange County, North Carolina,
this is to notify all persons having
claims against the estate of said
Harriet G. Hacker 1o present them
tb fhb undersigned by pctober
20, 2005, or this notice will be
pleaded fn bar of Ihelr recovery
All persons Indebted to said
estate please make immediate
payment
This the 20th day of July, 2005
CtirisUne Hacker Heady
2938 Monow Farm Ln.
Chapel Hill, NC 27516
July 20, 27; August 3, 10, 2005
n Pueuc Nonce ~°`
r. PUBLIC NOTICE IS HEREBY
6 GIVEN that the ERand Volunteer
Fire Company, Inc. will meet an
- Monday, August 22; 2005 et the
Volunteer Fire Department
located at 3900 U S 70 Wesl,
e ERand, N.C, 27243 a4 7:30 p m ,
in a public headng pursuant to
the requirements of section
147(1) of the Internal Revenue
Code of 1986, as amended, on a
proposal That the Lessee enter
Into a Commercial Loan
agreement under the "Code' in
order to finance the acqulsltion of
land. The loan will finance the
pbrchase of 19 acres of land for a
second fire station in EDand,
N C. The parcel(parcel# 10757)
is located on U S 70W across
the street from the Hancor Plant,
Just west of the Hoyle King
property.
To ,finance the costs of the land
end to pay costs and expenses
incidental to the financing, the
Lessee proposes fo enter Into
the Commercial Loan agreement
in the maximum aggregate
principal amount of 578.000 OD,
payable over a 5 year period al
an Interest rate of approximately
43% The Lessee will be
required to pay ail expenses of
malnlain(ng and Insuring the
properly and to pay all faxes on
the property. The payments due
pursuant to the Commercial Loan
agreement will be payable and
secured by a security interest
Ilan on the land above here
mentioned All persons
Interested may appear and be at
said time and place or may Rle
written comments with the
depanment prior to the hearing
set forth herein above, 8!22105.
By order of the ERand Volunteer
Fire Company, Inc, August 1,
2005
August 1D, 2005
NOTICE
STATE OF NORTH CAROLINA
ORANGE COUNTY
Having qualified as executrix
of the estate of Jerry Thomas
Baker of Orange County, North
Carolina, this is to notify all
persons having claims against
the estate of said Jerry Thomas
Baker to present Them to the
undersigned by October 27,
2005, or Ihls notice w(II be
pleaded in bar of their recovery.
Ail persons Indebted to said
estate please make immediate
payment
This the 27th day of July, 2005.
Lisa Clark
114 S MllFord br
Salisbury, NC 28144
July 27; August 3, 10, 17, 2005
NOTICE TO CREDITORS
All persons. firms and
corporations hav(ng claims
against Anna Malxner late of
Orange County. North Carolina,
who died May 5, 2005 are hereby
notified to present them to
Stevan V Maximer, Executor, (n
care of the undersigned attorney
at her address on or before
October 27th, 2005 or this Notice
will be pleaded In bar of recovery.
All persons, firms and
corporations Indeh(ed to the
deceasod, please make
immediate payment
This 27 Ih day o1 July, 2005
Jane( H. McLamb, Attorney
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August 22, 2005
Efland Volunteer Fire Co., lnc.
PO Box 39, Efland NC 27243
Public Notice Meeting
8/22/05
Attending; Kevin Brooks, Chief
Peter D Hallenbeck, Assistant Chief
Jack Adams, Board of Directors Secretary
Howard McAdams, Board of Directors member
Call to Order: P, Hallenbeck, 7:30 PM
Subject: Public meeting to discuss the purchase of a land fora 2"d station.
One citizen, a former firefighter and Board of Directors member attended. A
brief description of the land, intended future use, cast, and financing details was
given.
Adjourned at 8:00 PM
~~~~~
Peter D. Hallenbeck
Assistant Chief, Secretary
Efland Volunteer Fire Co, Inc.
,41~G~~~~- 5 ~
Fire Service Agreement
This agreement, dated this day of , 20, by and
between Efland Volunteer Fire Company, Inc., a body corporate organized under
the Laws of the State of North Carolina, the ("Fire Department"), and Orange
County, a body politic, the ("Political Subdivision").
WHEREAS, Fire Department is a not for profit organization duly authorized for
the purpose of providing firefighting services in an area within the jurisdiction of
the Political Subdivision; and,
WHEREAS, the parties wish to enter into an agreement setting forth the area and
duties of the Fire Department.
NOW THEREFORE, the Fire Department and Political Subdivision do hereby
agree as follow:
Political Subdivision recognizes that Fire Department provides firefighting
services to the hereafter generally described area or areas:
The area in which Fire Department has primary firefighting responsibilities
(area of responsibility) is Orange Rural Fire District.
Political Subdivision shall not be liable or responsible for the conduct and
activities of Fire Department.
IN WITNESS WHEREOF, the parties have had this agreement executed by duly
authorized representatives thereof.
Efland Volunteer Fire Company, Inc.
By
Name
Title
Orange County
By
Name
Title
~~~~~- ~ ~
Certificate of Approval
Approval of Chief Elected Official of
Orange County
I, chairman of the Board
of County Commissioners of Orange County, pursuant to the
Internal Revenue Code of 1986, as amended (the "Code") hereby
approve, authorize the entering into by Efland Volunteer Fire
Company, Inc. atax-exempt commercial loan by Sun Trust Bank in
the amount of $78,000 to finance a the purchase of a 19 acres of
land (Orange County parcel number 107.57 located in on Highway
70 across from Hancor, Corporation in Efland, NC 27243.
Execution of this document in no way creates liability on the part of
Orange County and Orange County is not responsible for the
repayment of any loan pursuant hereto.
By:
Title
Date